American Express High Yield Savings is worth considering if you want a competitive interest rate and don't need a physical branch

American Express Bank offers a high yield savings account that pays interest on the money you deposit. The account has no monthly fee, no minimum balance requirement, and no limit on how many times you can withdraw. The interest rate is higher than what most traditional banks pay, though the exact rate changes based on what the Federal Reserve does with interest rates overall.

Whether it is right for you depends on what matters most in a savings account. If you want the highest possible interest rate and are comfortable banking online only, it could be a good fit. If you need to walk into a physical location to deposit cash or speak with someone in person, this account will not work for you — American Express Bank has no branches.

Key Takeaways

  • American Express High Yield Savings pays a competitive interest rate with no monthly fees, no minimum balance, and no withdrawal limits.
  • The account is online-only, so you cannot deposit cash in person or visit a branch, but you can transfer money in and out electronically.
  • Interest rates on high yield savings accounts change regularly and depend on Federal Reserve decisions, so the rate you see today may not be the rate next month.
  • Your deposits are insured up to $250,000 by the FDIC, the same protection that covers deposits at traditional banks.

How the interest rate compares to other banks

High yield savings accounts at different banks pay different rates. American Express Bank's rate is typically competitive with other online-only banks, but you should check what other institutions are offering before you open an account. Rates change frequently — sometimes weekly — so a rate that is high today may not be high next month.

Traditional banks with physical branches usually pay much lower interest rates on savings accounts. If you have money sitting in a regular savings account at a brick-and-mortar bank, moving it to a high yield account at American Express Bank or another online bank could earn you significantly more interest over time, even though the difference in rate may seem small.

What you can and cannot do with this account

You can deposit money into the account by transferring it electronically from another bank account you own. You can withdraw money the same way — by transferring it back to your other account. You cannot walk into a location and deposit cash, because American Express Bank has no physical branches. You also cannot deposit checks by mailing them in or using a mobile app, as this account does not offer check deposit.

The account comes with a debit card, so you can use it to make purchases or withdraw cash from ATMs. However, the main purpose of a high yield savings account is to hold money and earn interest, not to use it for everyday spending. If you need to move money in and out frequently, the electronic transfer process works fine, but it is not when ready — transfers typically take one to three business days.

Fees and account requirements

American Express Bank charges no monthly maintenance fee for this account. There is no minimum balance you must keep in the account to avoid fees or to earn the advertised interest rate. You can open the account with any amount of money, even a small deposit.

Because there are no fees and no minimums, the main cost of having this account is the opportunity cost of keeping money somewhere else. If another bank is paying a higher interest rate, your money would earn more there. If you are not using the account and just letting it sit idle, you are not losing money, but you are not gaining as much as you could elsewhere.

FDIC insurance and safety

Money you deposit in American Express High Yield Savings is insured by the FDIC (Federal Deposit Insurance Corporation) up to $250,000 per account holder. This means if American Express Bank fails, the federal government guarantees you will get your money back, up to that limit. This protection is the same as what you get at any traditional bank.

If you have more than $250,000 to save, you can open multiple accounts at different banks and each one will be insured separately. For example, you could have $250,000 in an American Express account and $250,000 in an account at another bank, and both would be fully insured. The FDIC website has a calculator that shows you exactly how much of your money is insured based on how you structure your accounts.

Who should and should not choose this account

This account works well if you: have money you want to save rather than spend, are comfortable doing all your banking online, do not need to deposit cash in person, and want to earn more interest than a traditional bank offers. It is especially useful if you are building an emergency fund or saving for a goal that is months or years away.

This account is not a good fit if you: need to deposit cash regularly, prefer to work with a bank that has physical locations, want a checking account for everyday spending, or need customer service by phone or in person. If any of those describe you, a traditional bank or a credit union might be a better choice, even if the interest rate is lower.

How to move money in and out

To deposit money, you link a bank account you already own — at another bank or credit union — to your American Express account. You then transfer money electronically from that account into your American Express savings account. The transfer usually takes one to three business days to complete.

To withdraw money, you reverse the process: you request a transfer from American Express back to your linked bank account. Again, this takes one to three business days. If you need cash when ready, you can use the debit card that comes with the account to withdraw from an ATM, though you may be charged a fee by the ATM operator if it is not an American Express ATM.

Frequently Asked Questions

Can I use this account as my main checking account?

Technically you can, since the account comes with a debit card, but it is not designed for that purpose. High yield savings accounts are meant to hold money you are saving, not money you spend regularly. If you need a checking account for bills and everyday purchases, you should open a checking account elsewhere and use the American Express account only for savings.

What happens if the interest rate drops?

The rate you earn will change. Banks adjust their rates based on what the Federal Reserve does. When rates go up, your account will earn more. When rates go down, your account will earn less. You are not locked into any rate, and you can move your money to another bank if you find a better rate elsewhere.

How do I know if this rate is actually competitive?

Check what other online banks are paying on their high yield savings accounts. Websites that track savings rates can show you what multiple banks are offering. Compare the American Express rate to at least two or three other online banks before you decide. Remember that rates change frequently, so what is highest today may not be highest next week.

Is my money safe if I keep it here long-term?

Yes. Your deposits are FDIC insured up to $250,000, and American Express Bank is a legitimate, regulated bank. There is no risk that you will lose your money because the bank fails. The only risk is that the interest rate will drop, which means you earn less, but your principal is always safe.

Can I have multiple accounts at American Express Bank?

Yes, you can open more than one savings account if you want. Each account is insured separately by the FDIC up to $250,000. Some people open separate accounts to organize their savings by goal — one for an emergency fund, one for a vacation, one for a down payment — though this is optional.